can i still ship a gift in time for christmas? yeah, sure you can. great. where's your gift? uh... whew. [ male announcer ] break from the holiday stress. ship fedex express by december 22nd for christmas delivery. i'm jim cramer and welcome to my world. you need to get in the game. firms are going to go out of business and he's nuts! they're nuts! they know nothing! i always like to say there's a bull market somewhere. "mad money," you can't afford to miss it. hey i'm cramer. welcome to "mad money." welcome to cramerica. other people want to make friends, i want to teach you.

call me at 1-800-743-cnbc. i just came back from washington and i got good news and bad news. the good news, they all want to rise above. the bad news, the republicans want to rise above tax increases and the democrats want to rise above spending cuts. you can see that investors want to rise above washington. but this morning rally, the averages got pulled down when harry reid said there probably won't be a deal in time for christmas. who's calling the tune? the nasdaq climbing 1.8%. apple rallied eleven and change. i hope this mini rally is happening because people have looked over the fiscal cliff and they weren't terrified by what they saw. i hope we will get by. i hope they don't mind

government intervention in their portfolios. because they are not going away. i hope that because what i heard in washington today were two sides even though i can tell them that a deal would be done and there would be no vacation without legislation, we'd be in much better shape. i have to tell you, as encouraging as the market was this morning, the situation in washington is as discouraging. one after another i started with a new tack. i said let's go there. i said i totally agree the issue of spending not revenues. tell us what you have done to get spending done. did they give this fellow traveler some ideas? no. they attacked the president. each time when i asked for ideas

on what to cut, like right now, lower drug prices or pulling back our army from japan and europe. like every other country in the north does, like pulling back on positions from our army. i got the same response. it is the president's fault. i might have well have been a mannequin. they he want to talk about raising taxes of the rich. but it can't be dismissed as part of the compromise mosaic that will get the government out of the picture. they think they are so darn important down there. they think people either start or don't start businesses because of them. people start businesses to make money. i started five of them, i know. our politicians think they don't

spend because they have lower tax rates. but they put people to work if there is demand and they think they can make a lot of money. they would rather save than spend. research is issued to death. what are they down there? i read some biased chart. honestly. if you raise taxes and lowered spending, we would be on top of the world. our stock markets would soar. and the level of wealth creation would be beyond washington's wildest dreams. instead, i have a whole new scenario. we have to take a page from dr. strangelove. we have to learn to stop worrying and love the fiscal cliff. the leaders i talked to today know their actions will take us over the cliff. i understand there is now perception among the media that the man who got every republican to pledge no new taxes is spent.

the no tax increase republicans regard the stance as a birthright. a guy that is so anti-spend that he seemed to care more on these issues and more about the accountability for the disaster relief money. i can't really believe that. but a lot of guys down there will do anything to prove a point. but i can tell you there are enough garrets to force us over the cliff. given that the president is not going to let up. got a question either people don't know about the cliff or they believe that a deal will be done. and they that they have fulfilled the norquist pledge. where were the republicans when

they refused to pay for the wars, cut taxes, took money from the chinese two, why didn't republicans press for spending cuts when the president extended the tax cuts? and why doesn't the president offer spending cuts to medicare and defense and social security? how about weapons programs that don't fit in the terrorism world? how about foreign aid and maybe haggle with the drug companies. trying to be helpful, i'm sure some of today's rallies are based on the belief that says some of today's rally is better than tomorrow. but what, he is the fed chief. the levels of purchase have gotten a little insane. it's good for them but bad for those who have been buying stocks.

they are confident that they will keep rates low. it will run up into the fed statement and then sell off. you might as well wait for the market to come in. we will be back on cliff watch. if there is any big news, it is that i have a bunch of politicians to agree that there should be no vacation without legislation. or they are getting our critical message on this issue. maybe everybody i spoke to is ready to rise above these labels. put these pins on their lapels. time to avoid the cliff. that is a prescription for the wealth creation that is dependant upon washington's policies. here is my bottom line. i think we're going over the cliff and then we bounce back. when republicans can stick by the pledge. so we have to ask yourself can you handle the intrusion from washington in your portfolio? if you can't, no one will blame you for selling.

it really is that bad. manny in georgia, manny? >> jim, how you you doing? >> i'm real good. how about you? >> i'm doing great. bearing any major down turn would delta buy a 47% stake? >> i'm not going to talk about that. the airline stocks are real good. people trying to schnitzel a little on delta. the only one that has staying power is alaska air. they're doing a lot of things i like. it is the best of a bad situation but i like good situations. let's go to gregory in maryland. >> booyah from the crab cake state jim. >> i love a good crab cake. i remember phillips. >> they are still there. >> i have a question for you.

i called you about spectra energy. today with the acquisition of the pipeline and the 9% dividend what do you think i should be buying? >> i like spectra. can i state that i think that kmp is a good opportunity down here? that got hit real bad. i would snap that one up in a heartbeat. let's go to jack in new york. >> booyah from brooklyn. >> i'm going to be there later this evening, we ought to hang out. >> fedex is reporting record holiday package shipments. with the fiscal cliff looming, do you think that will carry their shares into the next point? >> we were going back and forth after a very frustrating day where dollar general blew up.

how come fedex acts badly? maybe that wasn't such a good day yesterday for federal express and for urgent mail. but we are holding onto it for now. every stock has been tipping itself lately. you know, i like companies so much more than congressmen. it is going to be very hard for democrats and republicans to compromise. i cannot blame people for being cautious. i did get a lot of good vibes about no legislation and you know what, i learned that i think ceos are better. "mad money" will be right back. coming up, mission critical. washington holds the market hostage.

cramer is turning to north dakota for the latest. holiday hustle. while registers are ringing, others are left out in the cold. tonight, an exclusive look at luxury with the ceo of saks fifth avenue. but investors cooled on the stock and sent its shares into the fryer, is this a value meal or has wall street lost its appetite for fast food? don't miss cramer's take, just ahead. all coming up on "mad money."

everybody is fretting about the fiscal cliff. until we get a deal. i got more negative when harry reid said it is unlikely that a deal will be done by christmas. i'm thrilled to have senator john hovan, a republican from north dakota who has been an advocate for bipartisan consensus here with us tonight. welcome back to "mad money." >> jim, good to be with you. >> i noticed that you are for a bipartisan situation and one of the things that tells me you are for real is that you have not signed a pledge that would make

it so that you can't vote for a tax increase. it should be a big deal on the order of four trillion dollars over ten years. that's what we need to get growth in our economy and the kind of deal that includes tax reform, entitlement reform and better spending control. >> when you were governor of your state you presided over what i think is the single greatest employment boom we've seen. is washington so different that you wish you were back home? >> you have been out to north dakota, you're invited back, but you are right. the fundamentals don't change. let's build that good business climate.

legal, tax and regulatory certainty, we can put those things in place with a big deal. we need to get it done. >> one of the things i was noticing. this is something fellow senator conrad was talking with me this morning about. i know that you are committed and in a sensible way to fix the tax code to get rid of some of these loopholes. the mortgage debt relief act of 2007 which allows borrowers to avoid paying taxes on debt. your biggest problem is you can't get people to come from other states to fill the jobs because they are under water in their mortgages. you are trying to close something that could help your state. you are right on. when we talk about closing loopholes and reforming the tax code in a pro-growth way, the real revenue comes from economic growth. that is what happens in north dakota where we have billions in reserves. we actually cut taxes.

but through a code that is certain and fair and makes sense and the revenue comes from economic growth. that is what we need to do as a country. the fundamentals don't change. >> i got a little confused today. trying to distinguish medicare and social security. he is still paying into social security. i'm baffled. is social security really an entitlement? >> it is something, it is a retirement system that our citizens are owed because they work all their lives and pay into it. i think we can reform all of them in a way where we don't change it for the people who are at or near retirement, but for younger folks we make bipartisan

changes that make sure the programs continue to be solvent, and i think everybody can agree on that. >> are you hearing anything from the president that can agree with that? >> we need presidential leadership right now. president obama needs to say yes, we can do these things. we need to do it now for the good of the country. >> are you optimistic that can occur? >> i'm hopeful and i'm going to keep pushing for it every single day. this is about what the american people want and need. >> one last question. you are pro growth and i have seen in action what you have done. are we missing something? is there a failure of imagination and some way to raise revenue involving oil and gas, that would make it so that we wouldn't have to raise taxes and could have more money? >> we have incredible opportunity in energy.

you've seen it in north dakota but we can do that throughout the country in many different ways. we have to unleash the energy of this great country and we do it with the things you and i have been talking about. it's the private sector, that is what is going to make the difference for this country. and energy is a big part of it jim. >> i know what you have done and i'm proud of what you have done. your state is emblematic of what could happen in more states, there is more oil than just in north dakota. >> and come back anytime. we love having you out there again. thank you so much. >> good man, thank you for being on the show. it has to do with spirit people, there is no rancor there. pro growth gets the job done.

after the break i'll try to make some money. >> coming up, holiday hustle. it's a harsh time for retail. while the registers are ringing in some shops others are left out in the cold. tonight he has a look at the luxury shopper with the ceo of saks 5th avenue.

washington is playing the role of the grinch. how is the high income consumer hanging in there? saks is the ultimate high-end department store, 11 of the stores had to be shut down for days, including the flag ship store in new york city. let's check in with the chairman and ceo of saks.

the stores have good values. welcome back to "mad money." you said people shop at saks depending on how they feel about their net worth. >> at 13,200 on the dow, not too badly. the fiscal cliff, that is what is looming out there in terms of an over hang in the market. >> the whole 1% that changed the tax code. is it nearly as important as what they feel like in terms of their psyche? >> absolutely. i think that whether the rate

goes up is less important than how does the dow react to getting some form of an agreement? i think that our customer can adapt to an agreement. >> let's throw in hurricane sandy. you were very, you know, wow, it was tough to talk about hurricane sandy. terrible loss of life. terrible damage. many of your stores got hurt. right after this, deutsche bank met with you and said despite sandy, things are pretty good. >> well look, i think there is the overhang in the environment. sandy was a punch to the stomach. the stores were closed. people weren't shopping online because there was no electricity. we took a hit. at the time of the conference call we saw an uptick in the business.

we can't talk about trends since then. we said that the impact of the storm was probably going to take us to a flattish performance. and i feel optimistic for the long term for our consumers. >> why is classic clothing not selling well but contemporary? is there any accounting for taste? >> well, look. people love what they love. accessories have been performing very well. shoes, handbags, jewelry. people love something that is new. something that is the same that they have in their closet, they're not buying. it is not just about accessories. fashion forward is selling very well. it has to be something that they are perceiving as being new and different.

when i look through, i felt that we had the real turn in this quarter. i really feel that you talked about the omni channel and the internet. these are real growth vehicles. >> there is a transformation in retail. omni channel is the buzz word but it really is different. you have to have the foundational system and you have to have the capabilities to service the customer. we are investing over $100 million to provide that. i believe it is going to change the business. the outlet business is another growth vehicle. we're opening six new ones this year. it's different than our full line store.

i think it is an opportunity for both. >> you reference the chinese shopper. it looks like we solved this. there is a lot of chinese people shopping. do you go to china and let them know about saks? i think there is an opportunity that is untapped. it is one of our fastest growing customer bases. we are seeing a slowdown in european tourists. i believe that we need to do some marketing in china. we need to see the u.s. as one of the great destinations of the world. >> i was recently at a competitor of yours. they had mark downs on warm weather clothes. >> cold weather clothing because of the heat, the warm weather is having issues. it is a small piece of our

business. but hopefully it is going to get cold again. >> i have to tell you, i wish you the best of luck. it sounds like despite the plagues, things have been doing pretty well. this remains a very good call on if you believe the stock market is going to go higher. it's not all about the fiscal cliff. you heard it from the man. stay with saks, stay with cramer. >> coming up, are you ready to get charged up? cramer goes electric on a hyperactive lightning round.

it is time for the lightning round. play to this sound and then the lightning round is over. are you ready? i want to start with ed in pennsylvania. >> hello mr. cramer. booyah from pittsburgh.

>> oh man, steeler nation what's up? >> my stock is cisco. >> cisco is the best house in a very tough neighborhood. so i'm saying don't buy even though i know it is cheap. let's go to jeff in new jersey. >> jim, mark west energy is down nearly 5% this past week. should i add and worry about their chronic secondary offer? >> i liked nwe and then it sprung up and this is no kmp. let's go to josh in massachusetts.

>> big beantown booyah. >> i'm going to give you stop confusing me with tom brady booyah. >> happy hanukkah and merry christmas to you. >> thank you. >> my company is cirrus logic. i love them and i know they are in bed with apple. and how do you feel? >> it has had such a big move. if i want to own an apple play, i'm going to own apple. why don't we go to mark in wisconsin? >> jim, thank you for taking my call. your thoughts on parker drilling. >> no no no no no we don't need parker drilling. let it come up and ka ching. i like to go with best of breed, which is slob.

how about jeff in illinois? >> happy holidays jim. thank you for taking my call. i have been whistling through the wheat field in the agriculture sector. >> those are both good companies. right now i prefer monsanto a little bit. but those are biotech companies that are seed companies. i'm not done. i'm going to phillip in arizona. >> hi jim, what do you think of alcoa at this point? >> it is a growth stock trapped in the commodity. it is going to have to wait. let's go to patricia in hawaii. >> yes, i'm here. booyah from hawaii. what's going on with yelp, i

bought it at $21 and it's been down? >> hold on to it. i think it is worth more. don't sell yelp. let's go to stewart in new york. >> how you doing? i love you like the giants and i have a winner for you for next year. >> well, um okay. it is okay. frankly, i prefer others to it. um, for instance, i would even prefer chesapeake to it right now. and that says a lot. i was going to do my stafford imitation. it gets better. here take this. it is the conclusion of the lightning round. coming up, a world away.

yum brands has made a meal ticket out of china. investors cooled the stocks and send the shares to the fryer. has wall street lost its appetite for fast food? just ahead.

nobody is more passionate about the market than i am. you are why i come out here and do this show. >> the stuff that you are doing for all of us is so important and i want to say thank you. >> we watch every day and we count on your help for small investors like us. >> put cramer's experience to work for you. "mad money" weeknights on cnbc. >> what are we supposed to do

with yum brands? the parent of kfc, taco bell, pizza hut. until weeks ago it was perceived to be a fantastic growth story. where kfc has been so popular in china. on november 30th yum came out with a forecast that with a forecast that how they got their changed. the company's forecast from china has hideous. given that china has been the big driver. stock falling nearly 10% in a single day. and all downgraded the darn thing. now fast forward to last thursday.

at this meeting they painted a more bullish picture. and the non china business. and they reiterated their positive views on the stock. $17 what the stock is now. so now you know what we've got. we have a genuine home spun face off with a pack of bears duking it out against a whole posy of bulls. which group is right about yum? sell sell sell. we know the business is turned around. taco bell, haven't been there lately? hearing good things. all of the overseas business is still growing like crazy.

the chinese business is so big that it accounts for 45% of the company's profits. the latest decline of the same store sales is permanent. they got sick of kentucky fried chicken and pizza hut. it seems as if the colonel may have gotten busted down to private. and i'm calling it a bump but a severe bump in the road. it is true that they are facing margin pressure. the so called tier one cities. 4% decline in same store sales is not a good thing. and there is no doubt newfound competition among chicken houses. however, yum is dealing, you know with the first issue by

shifting emphasis towards china's smaller cities, and as far as the decline from same stores sales go, last year comps were up 21%. the management was bullish about the longer term. the ceo said if the sky is falling in china. i promise i will know about it before you. definitely have a better read on china than we do. i think it makes sense to give him the benefit of the doubt. but now it is beginning to turn the corner. plus the chinese communist party has new leadership. through 2020 while doubling per capita income. so i have to believe the chinese government will do whatever it

takes. maybe the colonel is due for a battlefield promotion. but they are not the company to sit around and wait for china to improve on its own. they suggested that the business would turn around and the move for the smaller cities would be terrific. much of the competition, for example, in the big tier one and two cities, they have 2176 kfcs. but in the smaller cities, 1167. as far as i'm concerned, yum's real problem is not china. there is yum's fast growing

international business and then there is the slow growth domestic business. for the last year the company has shut down more stores than it opened. i'm saying right here right now give me a fee if it happened. do you think that is nuts? that is what altria did with phillip morris international. fast growing international one, and they decided to break up, a domestic stock and the growth stock in the form of phillip morris. i think yum should be the same thing. the business is sizzling. and now that taco bell has turned things around, i think that the domestic business has enough to turn around as well. right now, yum trades at 18 times earnings.

if you split up the breakup, i think it will get a higher multiple to the point where the sum of the two parts might be more $77 per share. look, even if yum doesn't break itself up, china is going to resume its long march upward. to me it seems like a recipe for a higher share price. when it comes to yum, i think the bulls were right and the bears were letting a chinese speed bump scare them away from what i regard as a great story. it would be great if it saw it self as a great break up. my proposal for yum could create instant profits for all aboard. let's go to stafford in oregon.

>> how you doing today? my question is regarding mcdonald. i know their numbers were better than expected. do you think it is a buy down at these levels? >> yes, i do. they had a miss step there. new ceo. they weren't sure. they are back to doing innovation. i don't think it is going to run away from you. but i think it is fine to own. let's go to dean in new york. >> i have a question about kc's general stores. they just came off the 52 week low recently and the earnings report came out today. and i want to know, do you think they are on the rise or what do you think? >> boy, that has been one i have really not liked. but that is a good report.

this is one of those where i have to look at it again. i'm only used to seeing bad numbers from them. i'm looking at nicole right now. she is all over it this week. hungry for profits. the only thing that can make it better for everybody is splitting the baby in two. "mad money" is back after the break. if you think running a restaurant is hard,

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i got into a heated tiff today with a congressman from new jersey. talking about government investment is terrible. the endless mention of solar stuff. the government has been trying to pick winners. take ethanol. it was a fuel that no one likes to use.

you use up resources, water and government subsidizes all sorts of farms, and that is a winner right? you think we would have a huge food stamp program because of poverty? this time we saw the completion of the most successful government intervention i've seen, the rescue of aig. aig guaranteed a gigantic amount of debt. second, aig guaranteed the success and trades it back to firms like goldman sachs. although they probably denied that. who cares about goldman right? everyone should have cared. if we took out the banking system we would be in the thick of the great succession. simply because the government let aig go under.

now the government has reaped the $22.7 billion profit for its effort. it was well, it turned out to be a savvy investment. the congressman pretended he didn't hear it. i mean, whatever happens to get you elected into a higher office. and then he seemed to attack me for being pro the government with aig. i want to thank two people who made sure the government took care of this situation here. tim masset and the government did multiple offers of aig. this one was the best of all. more than i can say for the private sector. the second person, aig ceo. this company had almost been

destroyed by reckless managers and executives. and through force of will fixed the darn thing and turned it into more of a powerhouse before the crash and it isn't done. this time it was done on blocking and tackling. a warm and heartfelt thanks. that is what we care about. stay with cramer. >> it is a brutal full contact sport. >> when the whistle blows, traders bracing for what could turn out to be the final play of the game. >> i know it is not easy but i promise to keep fighting for you. >> the road is a tough one. but the pay off can be a great win.

tonight on the 4th anniversary of the arrest of mastermind bernie madoff don't miss hif